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In the Short Run,a Perfectly Competitive Firm Produces Output and Earns

question 163

Multiple Choice

In the short run,a perfectly competitive firm produces output and earns ZERO economic profit if:


Definitions:

Earnings Before Interest

Earnings before interest is a measure of a company's profitability that calculates earnings before the expense of interest is deducted; it’s part of the calculation used for EBIT (earnings before interest and taxes).

Unlevered Cost

The cost of financing a project or investment without any debt.

Debt/Equity Ratio

This ratio signals the proportionate financing of company assets by means of shareholders' equity and debt.

Borrow

The act of receiving money, goods, or services from a lender or institution under an agreement to return or repay it in the future.

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